Author: Cyril Richert
“Keep calm and carry on” could be the motto of Wandsworth Council when staring at the deteriorating situation of some property developers in Nine Elms.
“The brakes have been put on construction work at Multiplex’s £1bn One Nine Elms site in south London” reports Construction Enquirer.
“Contractors have started leaving Guangzhou R&F Properties’ £900 million ($1.2 billion) One Nine Elms site in London as builder Multiplex chases the developer for payment“, tells real estate website Mingtiandi.
Another web magazine, Construction News (CN), wrote:
“Contractors have started leaving the £900m One Nine Elms site in London as Multiplex chases the developer for payment. […] A security guard said he expected more information on the plans to come out later today in the form of a letter to subcontractors, but said he expected the site would be closing soon. He added that it was unclear when work would start again.”
CN also said:
“In 2019, R&F failed to pay Multiplex a payment bond worth £15m for the site work that year, which the technology and construction court ruled was enough reason for Multiplex to suspend its work.”
Multiplex is the contractor appointed in January 2017 by Wanda, R&F previous owner of One Nine Elms’ site, to deliver the project.
A few days ago, the contractor and client R&F Properties published a joint statement saying they “are working together to deliver One Nine Elms, with a programme of works continuing to take place on site, returning to full capacity shortly“, according to CN. However, “Work on Multiplex’s £1bn One Nine Elms site in London is not expected to get back up to speed until the spring“, said Building.
It would be a drama as R&F has invested more than £1bn into London’s biggest luxury housing projects and much of the regeneration is dependent on their delivery.
One Nine Elms is a mixed-use project of two residential towers of 56 and 42 storeys, alongside a 173-room luxury hotel, which are due for completion in early 2023 (but will never be finished at the time).
The site is owned by R&F, a Chinese property developer based in Guangzhou, which is under huge financial trouble with the need to borrow £750m, as we reported last September.
In early January, R&F was put in “selective default” in January after it agreed with its lenders to delay a £535m debt repayment, according to Reuters. They bought the job out of Wanda, another Chinese developer which pulled out amidst financial difficulties.
One Nine Elms is one of the 3 sites owned by R&F within the area. Backing onto the development work at One Nine Elms is Nine Elms Square, which R&F and fellow Chinese property investment company CC Land acquired in 2017. The scheme consists of 1,417 new homes, shops and restaurants, and around 120,000 square feet of commercial space across 12 buildings. According to CN, contractor Mace and Midgard continues to work at pace,
Vauxhall Square is the third and final site owned by R&F on Nine Elms. Contractor Keltbray completed demolition in 2019 but now work on the site has been paused, said CN. R&F paid £157.7m to buy the land from British property investment company CLS Holdings in April 2017, with plans to build seven main buildings. The scheme includes two 50-storey residential towers, 3,100 square metres of retail space, 22,700 square metres of offices and four separate hotels. There will also be a new homelessness hostel.
Queen’s Square is R&F fourth project, but it is located in Croydon, and therefore not relevant to Nine Elms.